–New Paradigm II: What are your plans for the Age of Disemployment?

Mitchell’s laws:
●The more budgets are cut and taxes increased, the weaker an economy becomes.
●Until the 99% understand the need for federal deficits, the upper 1% will rule.
●To survive long term, a monetarily non-sovereign government must have a positive balance of payments.
●Austerity = poverty and leads to civil disorder.
●Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
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In The new paradigm: Disemployment. Less work; more life we discussed the fact that computers are becoming smarter and each year are able to do more of what we’d thought only humans could do.

For example:

SCIENTIFIC AMERICAN
Machines that think for themselves
New techniques for teaching computers how to learn are beating the experts
By Yaser S. Abu-Mostafa | June 20, 2012

Machine learning is a branch of computer science that combs through data sets to make predictions about the future. It is used to identify economic trends, personalize recommendations and build computers that appear to think.

A couple of years ago the directors of a women’s clothing company asked me to help them develop better fashion recommendations for their clients. No one in their right mind would seek my personal advice in an area I know so little about—I am, after all, a male computer scientist—but they were not asking for my personal advice.

They were asking for my machine-learning advice, and I obliged. Based purely on sales figures and client surveys, I was able to recommend to women whom I have never met fashion items I have never seen. My recommendations beat the performance of professional stylists.

Advances in machine learning over the past decade have transformed the field. Indeed, machine-learning techniques are responsible for making computers “smarter” than humans at so many of the tasks we wish to pursue. Witness Watson, the IBM computer system that used machine learning to beat the best Jeopardy players in the world.

The need for professional stylists has just been reduced somewhat.

Then there’s:

My New Scientist
Robots move into the mining business
30 July 2012 by Michael Moore and Michael Reilly

The dirty, back-breaking work of extracting minerals from the Earth is being taken over by machines. Trucks nearly as tall as three-storey buildings are a common sight rumbling through the dusty, red-hued landscape of the Pilbara region in Australia.

But look carefully at some of them: the cabs are empty of human occupants. The trucks are part of mining giant Rio Tinto’s Mine of the Future initiative. The firm is betting $500 million that robots are the future of mining.

South Africa’s famously deep gold and platinum mines are still mostly worked by people. Each day after blasting is complete, a foreman descends into the fresh tunnels, tapping the roof and listening for a hollow thud that could indicate a hanging wall is in danger of collapsing.

But entry inspections are often rushed, because miners’ pay is tied to hitting benchmarks in a timely fashion. Some 14 miners have died already this year in such “ground falls”, according to the country’s Department of Mineral Resources.

To keep miners out of harm’s way, Declan Vogt of the Council for Scientific and Industrial Research in Auckland Park, Johannesburg, South Africa, and colleagues have built a robot that can navigate the 1-metre-high tunnels on tank-like treads and scan rock faces for weaknesses with a thermal camera. “Rock that is firmly attached to its surroundings will cool more slowly than rock that is broken,” says Vogt.

When weaknesses are spotted, the robot can tap on them with a long arm, and use microphones to listen to the sound it makes. On-board neural network software trained by mine inspectors will recognise if the area is safe.

“Our vision is of a fleet of small robots doing various tasks,” including mining and hauling ore, Vogt says.

Swedish firm Sandvik has deployed a mixture of autonomous heavy equipment and robot vehicles in several mines around the world over the last few years. If all goes as planned, within the next decade some mines will be designed not to suit people, but to accommodate the needs and abilities of robots.

Thousands of miners will be safer — but unemployed. Then consider this:

ScienceNews
Paralyzed woman grips, sips coffee with robot arm
Human brain-computer interface enables useful movement
By Rachel Ehrenberg June 16th, 2012;

Directing a robotic arm with her thoughts, a paralyzed woman named Cathy can pick up a bottle of coffee and sip it through a straw, a simple task that she hasn’t done on her own for nearly 15 years. The technology that brought about the feat is a brain-computer interface system: A computer decodes signals from a tiny chip implanted in the woman’s brain, translating her thoughts into actions that are carried out by the robot arm.

Visualize one manager, running an entire robotic factory with her thoughts. She might lounge on a beach, looking at a screen that can show her every inch of the operation.

The factory computers run everything, but on those rare occasions, when the computers encounter a circumstance they’ve not seen, the human supervisor thinks, “Shut down belt #6.” The belt stops

The computers (using machine learning) now know that when this rare circumstance occurs again, they’ll shut down belt #6. If they’re wrong, the human will think of the correct solution, further teaching the computers.

Eventually, computerized machines will do it all. Even that one manager will be unemployed. World unemployment will rise one more tiny notch.

Is this a bad thing or a good thing? I say it’s a good thing.

I am unemployed, but my unemployment is known as “retirement.” I no longer need to work for money, so I don’t. My “work” is this blog, tennis, reading, my family, travel. For me, unemployment is freedom.

How would you like to be able to spend the rest of your years doing whatever pleases you? Given that opportunity, “unemployment” would not be a problem; unemployment would be your goal.

We view unemployment as a problem, because we can’t visualize a world where people don’t work for money. But look around you. Millions of people don’t need to work for money, and most of them lead pretty nice lives.

But, our leaders devise plans to make us all work for money. They want to “cure” our freedom not to be forced to work for money. It’s as though there were some moral imperative that makes working for money good and not working for money bad.

Once, that might have been true. But no more. Our leaders should devise plans to anticipate the future — plans that help us deal with not needing to work for money.

How? By providing either the things we buy for money, or by providing the money itself.

Stretch your imagination and visualize all the things you pay for: Food, clothing, shelter, health care, amusement. What if you were given some of those things and already had the money to pay for others. Wouldn’t your life be better?

What if federally provided computers, programmed with massive data about human afflictions, tested your body, to locate problems. Might you enjoy a healthier life?

What if everyone’s housing cost less, because human labor no longer was need to build houses? Might you enjoy a better home?

What if food and clothing were less expensive, because machines did all the farming, designing, sewing, shipping and selling?

I have just described doctor, carpenter, plumber, roofer, designer, salesperson, shipper and farmer unemployment. Is that a bad thing or a good thing?

Bottom line: I believe the focus on “curing” unemployment is misdirected and harmful. It’s like focusing on the creation of a better horse cart, in the age of automobiles.

Our future is not one of full employment. Our future is one of disemployment — something closer to what I have, now.

Even my Modern Monetary Theory (MMT) friends propose a cure for unemployment called Jobs Guarantee (JG). They are well meaning, but do not consider the future of technology. Better they should propose a QLG (Quality of Life Guarantee).

Our leaders should focus on ways to improve our lives with less mandatory work. Employment, as a basic goal, is becoming obsolete. The basic goal is the improvement of our lives.

We are at a fork in the road. The government can focus on, plan for, and invest in, new technology and appropriate laws. Or it can pretend technology has plateaued, and continue to improve horse carts.

In an ideal world, each of us should be able to do what pleases us most (so long as others are not injured, of course). If working for money pleases you, so be it. But if there are other things that please you more, the ideal world would allow you to do them. Either way, disemployment is coming, whether we like it or not.

When our leaders speak of curing unemployment, your question should be, “What are your plans for making my life and my children’s lives more enjoyable, more comfortable, safer, healthier — better? What are your plans for the coming age of disemployment?“

Rodger Malcolm Mitchell
Monetary Sovereignty

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No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia. Two key equations in economics:
Federal Deficits – Net Imports = Net Private Savings
Gross Domestic Product = Federal Spending + Private Investment and Consumption + Net exports

#MONETARY SOVEREIGNTY

Trying to survive in this world of debt-hawk finger pointing and voter remorse. GO BIG!!

There probably is a word for saying you want something but don’t.

The word for really wanting something, then when you get it, not wanting it any more is “remorse,” as in “buyer’s remorse” But what is it when you pretend to want something (for ulterior reasons), but know that if you get it, you’ll hate it?

Perhaps we should stick with “remorse,” as in debt-hawk remorse. Who can forget the loud-mouth blusterers lying about the “unsustainable deficit,” Who can forget the phony demands of Congress and the debt-hawk blogs, that we not only cut the deficit, but “GO BIG”?

Who can forget the sickening panderers to the idiot Tea Party — their groveling became so extreme, these lickspittle politicians attempted to outdo each other in rejecting all hope of compromise — just to brown up to right wing? Ah, profiles in courage.

Now, those same lickspittle politicians, having destroyed the lives of the lower 99% income group, look for a whipping boy.

C-SPAN
DEFICIT & ECONOMY
Leaders Urge Deficit Reduction Committee to “Go Big”

WASHINGTON, DC, Wednesday, September 21, 2011 (Note the date)

On Capitol Hill the deficit reduction “super committee” continues its work – and today the New America Foundation hosted a discussion with a bipartisan group of current and former members of Congress and White House officials who urged the joint committee to “Go Big” and seek deficit reductions of $4 trillion or more.

Translation: “Even a $4 trillion deficit cut isn’t enough. We want more, more, more. Maybe $5 trillion. Or $6 trillion. Sky’s the limit. (Tea Party, are you watching? Is my nose in deep enough?)

“But a funny thing happened on the way to the Tea Party. Someone used the magic words “fiscal cliff,” and well duh, we discovered cutting deficits (i.e. bleeding the anemic patient) will hurt the economy. Who’da thunk?”

What is the Fiscal Cliff?
By Thomas Kenny, About.com Guide

“Fiscal cliff” is the popular shorthand term used to describe the conundrum that the U.S. government will face at the end of 2012.

Possible Effects of the Fiscal Cliff

The effect on the economy could be dramatic. While the combination of higher taxes and spending cuts would reduce the deficit by an estimated $560 billion, the CBO estimates that the policies set to go into effect would cut gross domestic product (GDP) by four percentage points in 2013, sending the economy into a recession (i.e., negative growth).

A Wall St. Journal article from May 16, 2012 estimates the following impact in dollar terms: “In all, according to an analysis by J.P. Morgan economist Michael Feroli, $280 billion would be pulled out of the economy by the sunsetting of the Bush tax cuts; $125 million from the expiration of the Obama payroll-tax holiday; $40 million from the expiration of emergency unemployment benefits; and $98 billion from Budget Control Act spending cuts.

Amid an already-fragile recovery and elevated unemployment, the economy is not in a position to avoid this type of shock.

Translation: “We Tea Party sycophants bravely demanded that the government “Go Big!” Even a $4 trillion deficit reduction wasn’t sufficient. Now, facing a puny deficit reduction of less than 15% of our “Go Big” amount, we’ve begun to panic.

“Nobody told us deficit reduction pulls money out of the pockets of the public. How were we supposed to know that?

“Sure, we voted for the law. In fact we insisted on it at the threat of filibuster. In further fact, $4 trillion wasn’t enough. But, this isn’t our fault. It’s the fault of you voters. You’re the ones who wanted to cut the deficit. You should have known better.”

The cost of indecision is likely to have an effect on the economy before 2013 even begins. The CBO anticipates that a lack of resolution will cause households and businesses to begin changing their spending in anticipation of the changes, possible reducing GDP by a full half-percent in the second half of 2012.

Translation: “We pretend the deficit reduction is too sudden. When we said, GO BIG!, we really meant, “GO BIG!, but go really, really slowly big. Like BIG that takes many years.

“Yes, we know, taking dollars out of the economy, no matter how slowly, will hurt the economy. And yes, we know the American public — especially the lower income 99% — will take a terrible beating (though the upper 1% will be O.K.)

“But the important point is: The right wing in Congress, can’t lose. When the American worker falls over the fiscal cliff, we’ll blame Obama, you voters will believe us, and we’ll get elected. Simple.

“Right wing politics is the most fun when the President is clueless, his party is wimpy and the voters are ignorant.

GO BIG!! GO BIG!! GO BIG!!”

Rodger Malcolm Mitchell
Monetary Sovereignty

#MONETARY SOVEREIGNTY

–NPR still falsely claiming to broadcast “both sides” of important issues. Write them

A bit more than one year ago, this blog published “Is NPR in league with the Tea Party, or simply clueless?” The theme of that post is summarized in the following excerpt:

Today, I heard a discussion on National Public Radio (NPR). The participants claimed the media are hamstrung by the need to present both sides of each issue.

They lamented the fact that “fairness” required them to give equal weight to opposing opinions, even when one opinion was far more persuasive than the other — and shouldn’t the media have more leeway in exercising their judgement on this?

The specific subject was the federal deficit. Both participants agreed the deficit must be reduced, so the “two sides” were: Raise taxes or don’t raise taxes.

As readers of this blog know, those are not both sides of the deficit issue. Those “two sides” are mere details in the real issue: Increase the deficit or don’t increase the deficit.

The closing sentences of the post read:

Contact your local NPR station (www.mpr.org) and ask them to do as they claim to do: Broadcast both sides of the issue – the real both sides. If enough people request it, NPR finally may realize they are missing an important part of the economics debate.

I guess not enough people contacted NPR, because so far as I know, nothing has changed, because I heard Terry Gross (moderator of “Fresh Air”) interview David Wessel, “economics editor for The Wall Street Journal and writer of the Capital column, a weekly look at the economy.“

Wessel was puffing his book titled, “Red Ink: Inside the High-Stakes Politics of the Federal Budget.” According to NPR:

(Wessel’s book) breaks down the budget in stark terms: how the government spends its money, who pays what in taxes, and why politicians can’t reduce a potentially catastrophic debt load.

Frankly, I haven’t read Mr. Wessel’s book. (I also haven’t read books titled, “Why Evolution is wrong and Creationism is right” or “The earth really is the center of the universe, held aloft by Atlas.”) But, I suspect Mr. Wessel does not supply data to prove the federal debt is “catastrophic.” No such data exists in the real world. I can’t imagine why he wrote his book, since it undoubtedly contributes nothing to what already has been said by every other misguided debt hawk (Is there any other kind?)

Anyway, NPR’s web site provides this discouraging news: Mr. Wessel “appears frequently on National Public Radio’s ‘Morning Edition’ and on WETA’s ‘Washington Week.'”

Why is this discouraging? Because contrary to NPR’s protestations and mission, Wessel is firmly planted on one side of the debt discussion. Here are a couple of the discouraging comments, pulled directly from the NPR Website:

Wessel thinks there is a fundamental difference between the two parties “about how important and how big a role the government should play in our economy and that influences what you think should be done to cure the deficit.“

A synonym for “cure the deficit” might be “prevent economic growth and send us into a recession or depression,” for that’s exactly what “curing (aka reducing) the deficit” would do.

–The new paradigm: Disemployment. Less work; more life.

Today, I saw these headlines:

“Waste Management will trim some management”
“Telenor to cut 2000 jobs in India”
“Alcatel-Lucent Plans to Cut 5000 Jobs”
“Mangano cuts 200 jobs”
“Morgan Stanley plans further staff cuts”
“Fairfax to shed 1900 staff”
“China’s ZTE May Cut Employees”
“HP confirms layoffs; Cutting 500 jobs”

If you think this is symptomatic of a world-wide recession, you’re right – but only somewhat. It’s also symptomatic of something else. Consider these articles:

JCPenney to get rid of check-out counters and clerks, use self check-out machines and RFID chips
Posted: 07/19/2012, By: Ann Geyser, newsnet5.com

TAMPA -CEO Ron Johnson said JC Penney it will remove check-out counters in stores and replace them with a system that won’t require clerks. Shoppers will be able to use self check-out machines, similar to those found in grocery stores. Johnson told “Fortune” magazine he hopes to phase out check-out counters by 2014.

Translation: “We don’t need people to do what computerized machines can do.”

A Day Job Waiting for a Kill Shot a World Away
Heather Ainsworth for The New York Times

HANCOCK FIELD AIR NATIONAL GUARD BASE, N.Y. — From his computer console here in the Syracuse suburbs, Col. D. Scott Brenton remotely flies a Reaper drone that beams back hundreds of hours of live video of insurgents, his intended targets.

By 2015, the Pentagon projects that the Air Force will need more than 2,000 drone pilots for combat air patrols operating 24 hours a day worldwide. Until this year, drone pilots went through traditional flight training before learning how to operate Predators, Reapers and unarmed Global Hawks. Now the pilots are on a fast track and spend only 40 hours in a basic Cessna-type plane before starting their drone training.

True, drones cannot engage in air-to-air combat, but Colonel Brenton said that “the amount of time I’ve engaged the enemy in air-to-ground combat has been significant” in both Reapers and F-16s.

Translation: As computerized equipment improves, people need less training time. Though today, drones cannot engage in air-to-air combat, tomorrow they will. Every day, computerized machined do the work people formerly did.

At the start of the Industrial Revolution, it was feared machines would cause unemployment by doing “people” jobs. That didn’t happen. The machines actually helped create jobs, not just because machines needed to be guided by human hands, but by increasing the need for “back office” hands. Slowly, machines forced people from blue collar to white collar work.

Today, we are in the Computer Revolution, and the rules have changed. Not only can machines do the blue collar work; they can do the white collar work; they can be creative; they can answer questions as Watson did.

In the May 16th post, “Coming soon to a world near you: Economics for cyborgs. Humans as a transition species” we spoke of humans being a transition species. Eventually, computerized machines will be able to do almost every physical and mental task humans now can do.

The immediate question is: What will happen during the transition?

As computers become smarter, the U.S. standard 8-hour day, with 2-3 week vacation plus various holiday, no longer is sustainable. The nation neither needs nor wants that much human labor.

Business doesn’t want it, because human labor usually is less efficient and more costly than machine labor. People don’t want it, because we wish to pursue our own personal interests rather than an employer’s interests.

The trend takes us on two divergent paths:

1. Unintentional massive unemployment, with growing starvation and homelessness
or
2. Shorter work day/year.

The first, unintentional unemployment, leads to poverty. The primary purpose of employment is to obtain dollars with which to pay for goods and services, many of which are necessary for, or at least contribute to, a happier life.

The second, shorter work day, has begun in some nations. Eurofound published a report showing the “Average collectively agreed normal weekly hours, 2010”. Some examples:

Greece, Hungary, Poland: 40 hours; Ireland: 39; Spain: 38.6; Italy: 38; Germany: 37.7; UK: 37.5; Denmark: 37; France: 35.6

Clearly, there is nothing sacred about the 40-hour week, or any workweek length, but this leads to the problem of pay. Will companies pay less for a less than 40 hours of work?

If workers now receiving, for instance, $20 per hour for a 40 hour week ($800 per week), and later go to, for instance, 30 hours a week, will they still receive $20 per hour — a 25% pay reduction to $600 per week? Why not?

The same question appears if we visualize annual job sharing, in which, for example, one person works January – June and a second person works July – December. No matter how hours, days or months are split, it is hard to imagine why employment matching population growth will not lead to reduced per-person salaries.

Although worker productivity continues to rise, workers themselves are not more valuable to employers. The rise in productivity is due to the computerized machines “digging holes faster,” not because people have learned to run the machines faster. Human work is becoming less necessary.

So, the total available work must be spread to more humans. By federal law, there could be shorter days (8 hours), shorter weeks (down from 5 days) or shorter years (fewer weeks of work).

This leaves the question: How do we maintain per-person income in the face of reduced need for human labor? I suggest the answer lies with our Monetarily Sovereign government.

One approach would be for the government to provide a “citizen salary” for every man, woman and child in America. In essence, the government could be an “employer” that pays all Americans a salary for life — a extension of Social Security — sufficient to provide a moderate quality of life.

Other approaches would be for the federal government to provide benefits people now must pay for:

*Free Medicare for all
*Discounted food
*Discounted clothing
*Reduced federal taxes
*Reduced sales and other local taxes (made possible by federal subsidies to local governments)
*100% free college education
*Additional salary for people who wish to work in areas most likely to improve the quality of life for Americans: Research & Development in Medicine, Biology, Physics, etc.

This proposal lacks details, and many devils lurk in those details, but we must face the fact that human labor will be less necessary in the future, while human needs will continue. There simply will not be sufficient job-related pay to spread among a growing population. Unemployment will be a growing problem, which will cause more frequent and more severe recessions, in turn causing more unemployment.

Yes, we can attempt the Chinese solution to population growth, but that seems to cause hardship, when our goal should be the improvement of our lives.

The new paradigm will be disemployment. We must recognize this inevitability and begin to formulate plans to deal with it. Else it will reduce our lives to misery.

If not this, what? If not now, when?

Rodger Malcolm Mitchell
Monetary Sovereignty

#MONETARY SOVEREIGNTY

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